Announcement of World Bank Lends Sixty Million Dollars to Help Solve Mexico City’s Pollution Problems on May 27, 1982

; ·f,' ,. ''t ···.·.·1· ,;_, o, . .-:_¥'_ ..:-""'.·· . ~«'.' ,<f,~ • : : l~~EDIA TE R~LEASE . .. 'A . I ttWorld"Bank 1818 H Street, N.W., Washington, D.C. 20433, U.S.A.• Telephone;. (202) 477-1234 BANK NEWS RELEASE NO. 82/98 Ciro Gamarra May 27, 1982 ( 202) 477-8034 WORLD BANK LENDS' $60 MILLION TO HELP SOLVE MEXICO CITY'S POLLUTION PR0BLEMS Mexico City, one of the largest urban-industrial complexes in the world, will implement~ comprehensive environmental protection program with the assistance of the World Bank. The Bank has approved a $60 million loan to help finance a pollution control project in Mexico's capital city and other important urban centers. The Pollution Control Project is part of Mexico's long-run program to reduce pollution levels. The program's main objeetives are to strengthen pollution control s_trategies ijnd enforcemer,t procedures; and to encourage and help finance investment by industrial firms aimed at reducing atmospheric and water pollution. With an estimated population of nearly 15 million, tbe metropolitan area of Mexico City is already the third most populous urban center in the world and is rapidly moving to become the first. It is projected to have a population of at least 27 million or as high as 33 million by the year 2000. The greater Mexico City area accounts for nearly one quarter of the country's total population, more than one third of the industrial production, and about one half of the country's estimated 7 million motor vehicles. Rapid industrial and urban growth have created high levels of pollution of the air, water, and land in Mexico City and in other urban_~reas such as Guadalajara, Monterrey, and Coatzacoalcos-Minati.tlan. -- ·-- It is estimated that nearly 10,000 tons of pollutants were emitted per day into the air-shed of Mexico City during 1980. Mexico City's air pollutior/·problems are intensified by the city's location in a sheltered valley at a high altitude ( over 2,000 meters), with high solar radiation, poor ventilation, and poor combustion conditions. At an estimated total cost of $190.9 million, the project will provide funds through the Industrial Equipment Trust Fund (FONEI) of the Bank of Mexico for the purchase of pollution control equipment by industrial enterprises and for the purchase of automobile emission testing .B.o_uipment by private garages. FONEI is the most important source of funds for·· pollution control investment by private industries in Mexico • •• NOTE: Money figures are expressed in U.S. dollar equivalents. . .. I  0 - 2 - . 1 The project will also finance acquisition of pollution monitoring :_;tJipment, laboratory facilities, and emission testing and diagnostic equipment for automobile inspection stations. Technical training and support studies to help develop long-term control strategies and emission standards will als;· be provlJed. • I· Represe~ting an effort to tackle Mexico's most urgent pollution .. ·control needs and to lay the t:fasis for formulating more comprehensive . strategies, the project will help in controlling 80 to 100 critical sources of industrial pollution and in implementing an automobile inspection and maintenance program which will cover a significant number of Mexico City's 3.5 million motor vehicles. The project contains an important institution-building component. It will strengthen the current programs of the concerned agencies by helping to train staff, and to develop and provide important facilities. The project will also promote coordination within and among the various agencies involved in pollution control activities. The main implementing agencies of the project will be FONEI, the . Secretariat of Heal th and Public Welfare (for air pollution control and solid waste control programs) and the Secretariat of Agriculture and Water Resources (for water pollution control programs). The $60 million loan was made to Nacional Financiera, S.A. with the guarantee _,r the United Mexican States. It includes a capitalized front-end fee of $900,000 and will be repaid over 15 years, including three years of grace, with interest at 11.6% per annum. • !; • ,..'ti: - ' ••• ,· ,.. , '- ' a··., ... __ •._,,.